A condition subsequent is a philosophical and legal term referring to a defined event which terminates a proposition or a
contract
A contract is a legally enforceable agreement between two or more parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, services, money, or a promise to tr ...
ual obligation.
In contrast to a
condition precedent A condition precedent is an event or state of affairs that is required before something else will occur. In contract law, a condition precedent is an event which must occur, unless its non-occurrence is excused, before performance under a contract b ...
, a condition subsequent brings the event (or obligation) to an end, rather than being necessary for to the event or obligation to occur.
In law, a condition subsequent is an event, or state of affairs, whose occurrence is automatically construed to terminate the obligation of one party to the other.
One example is that, if a man agreed to pay a
barber
A barber is a person whose occupation is mainly to cut, dress, groom, style and shave men's and boys' hair or beards. A barber's place of work is known as a "barbershop" or a "barber's". Barbershops are also places of social interaction and publi ...
to shave his beard, the barber then failing to do so would terminate the man's obligation to pay.
An
exit clause is a form of condition subsequent that can serve as a form of insurance for the party to whom it applies.
In
contract law
A contract is a legally enforceable agreement between two or more parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, services, money, or a promise to t ...
, a
contract
A contract is a legally enforceable agreement between two or more parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, services, money, or a promise to tr ...
may be
frustrated on the occurrence of a condition subsequent: in a contract to provide a music hall for a musical performance, the burning down of the music hall may frustrate the contract and automatically bring it to an end. ''
Taylor v Caldwell
''Taylor v Caldwell'' is a landmark English contract law case, with an opinion delivered by Mr Justice Blackburn which established the doctrine of common law impossibility.
Facts
Caldwell & Bishop owned Surrey Gardens & Music Hall, and agreed ...
'' 3 B. & S. 826, 122 Eng. Rep. 309 (1863) In a loan agreement, a condition subsequent is one which the borrower is required to satisfy within a set time period following their acquisition of the funds. Failure to do so typically triggers a
default.
Conditions subsequent can be explicitly stated in the language of a contract, or implied by the nature of an agreement.
Implicit conditions subsequent often apply in the case of
retail
Retail is the sale of goods and Service (economics), services to consumers, in contrast to wholesaling, which is sale to business or institutional customers. A retailer purchases goods in large quantities from manufacturing, manufacturers, dire ...
transactions, like
point of sale
The point of sale (POS) or point of purchase (POP) is the time and place at which a retail transaction is completed. At the point of sale, the merchant calculates the amount owed by the customer, indicates that amount, may prepare an invoice f ...
purchases.
In
property law
Property law is the area of law that governs the various forms of ownership in real property (land) and personal property. Property refers to legally protected claims to resources, such as land and personal property, including intellectual pro ...
, a condition subsequent is an event which terminates a party's interest in a property. When land rights are subject to a condition subsequent, this creates a defeasible fee called a
fee simple subject to condition subsequent.
In such a fee, the future interest is called a "right of reentry" or "
right of entry
Right of entry refers to one's right to take or resume possession of land, or the right of a person to go onto another's real property without committing trespass. It also refers to a grantor's power to retake real estate from a grantee
A grant ...
."
There, the fee simple subject to condition subsequent does not end automatically upon the happening of the condition, but if the specified future event occurs, the grantor has a right to retake his property (as opposed to it reverting to him automatically). Again, the right of entry is not automatic, but rather must be exercised to terminate the fee simple subject to condition subsequent. To exercise right of entry, the holder must take substantial steps to recover
possession and
title
A title is one or more words used before or after a person's name, in certain contexts. It may signify either generation, an official position, or a professional or academic qualification. In some languages, titles may be inserted between the f ...
, for example, by filing a lawsuit.
One of the languages used to create a fee simple subject to condition subsequent and a right of entry is "to A, but if A sells alcohol on the land, then grantor has the right of reentry."
Common uses include language such as "may", "but if", "however", or "provided that..."
Some examples of conditions subsequent often requested by parties to a contract include
bankruptcy
Bankruptcy is a legal process through which people or other entities who cannot repay debts to creditors may seek relief from some or all of their debts. In most jurisdictions, bankruptcy is imposed by a court order, often initiated by the debto ...
,
divorce
Divorce (also known as dissolution of marriage) is the process of terminating a marriage or marital union. Divorce usually entails the canceling or reorganizing of the legal duties and responsibilities of marriage, thus dissolving th ...
, or
relocation to a different area; a contract with such conditions will free that party from obligation to carry out its terms if some unforeseen event causes the situation to change dramatically. Generally, the defendant has the
burden of proof to demonstrate that conditions subsequent were met.
Compared to condition precedent
In comparison, a condition subsequent brings a duty to an end, whereas a
condition precedent A condition precedent is an event or state of affairs that is required before something else will occur. In contract law, a condition precedent is an event which must occur, unless its non-occurrence is excused, before performance under a contract b ...
initiates a duty.
See also
*
Condition precedent A condition precedent is an event or state of affairs that is required before something else will occur. In contract law, a condition precedent is an event which must occur, unless its non-occurrence is excused, before performance under a contract b ...
*
Necessary condition
In logic and mathematics, necessity and sufficiency are terms used to describe a conditional or implicational relationship between two statements. For example, in the conditional statement: "If then ", is necessary for , because the truth o ...
*
Sufficient condition
In logic and mathematics, necessity and sufficiency are terms used to describe a conditional or implicational relationship between two statements. For example, in the conditional statement: "If then ", is necessary for , because the truth of ...
References
Further reading
*
{{DEFAULTSORT:Condition Subsequent
Contract law
Property law